Ma’s election victory fails to boost housing market

DAMP SQUIB:A survey says most potential home-buyers still think prices will continue to fall this year as ongoing eurozone problems add to their caution

By Crystal Hsu / Staff Reporter

The outcome of the presidential election failed to boost home-buying interest among Taiwanese, as many expect housing prices to fall this year and are taking a wait-and-see approach before buying, a survey by Sinyi Realty Inc (信義房屋) showed yesterday.

A total of 66 percent of respondents said the presidential election result will not affect their purchase decisions, contrary to reports speculating about a recovery of confidence in the event of President Ma Ying-jeou (馬英九) winning re-election in the Jan. 14 elections.

Developers and real-estate brokers had previously said a large number of prospective home buyers stayed away from the market out of concerns over political uncertainty, but that the market would recover once the election was over.

The survey suggested there will be a protracted period of tepid trading, after home transactions shrank 11.06 percent year-on-year to 361,000 units last year, based on data released by the government yesterday.

“The majority of the public remains pessimistic and prefers to stay on the sidelines on expectations of a price correction later this year,” Stanley Su (蘇啟榮) said.

About 42 percent of respondents said home costs will trend down this year, while 37 percent believed they would remain flat, the survey found. Only 21 percent expected that Ma’s re-election will cause prices to rise, the survey said.

Among those with bearish views, 36 percent expect housing prices to drop between 5 percent and 10 percent and a further 26 percent anticipate a deeper correction, the poll indicated.

Nearly 60 percent of respondents said the ongoing European debt crisis will affect their buying interest and are taking a cautious approach until the region shows clear signs of stabilization.

Additionally, 58 percent voiced worries that the government might impose heavier property taxes, in line with the actual transaction price, thereby increasing holding costs — because present property values are officially taxed at well under market rates.

The public will also take cues from major domestic economic bellwethers, such as unemployment and interest rates, when making purchase decisions, Su said.

The survey was based on the responses of 1,034 people questioned online between Jan. 15 and Jan. 20, Sinyi said.